Settlement agreement and retaining WW-benefits
When entering into a settlement agreement, how do you ensure retention of unemployment benefits? We explain in this article.
TRANSITIONAL ALLOWANCE
Partial dissolution of employment contract may entitle to transitional allowance. In 2018, the Supreme Court ruled that if there is no full dissolution of the employment contract, the employee may be entitled to (partial) transitional allowance. However, this must involve a forced reduction of the scope of employment by at least 20%.
The amount of the transitional allowance is determined on the basis of the last earned salary. If the employee's working time is substantially and structurally reduced by at least 20%, the employee may be entitled to a transitional allowance for that part. The partial transitional allowance must be calculated in proportion to the reduction in working time, taking as a basis the salary the employee was previously entitled to. On this page about transitional allowance you can calculate the partial transitional allowance.
Need advice?
According to the Supreme Court, it does not matter whether an existing contract is dissolved and a new one is offered or whether there is a partial dissolution. In both situations, the right to partial transitional allowance arises if the number of working hours is substantially and structurally adjusted. Even if parties jointly agree the structural reduction (e.g. with a settlement agreement), the right to partial transitional allowance exists.
The advice is to contact an employment law specialist in case of partial dissolution. There are specialists working within Labour Lawyer who can advise you on your rights to partial transitional allowance.
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